2012-09-06 AICC Meeting Syed Zaeem Hosain Aeris Communications, Inc.

1Confidential Information

2012-09-06 AICC Meeting Syed Zaeem Hosain

Aeris Communications, Inc.


Topics• State of Cellular• Technology comments• Carrier deployments

• 2G GSM/GPRS Shutdown• Impact to Industries• Strategies for mitigation

• Status of 4G LTE … and futures• Near-term issues• What the future holds

• Questions


Technologies, Protocols, Evolution

– Note: Some LTE Advanced announcements are not formal yet

Technology Gen Protocol VzW, US Cellular Sprint AT&T,

T-MobileClearwire,

Satellite, etc.GPRS 2G TDMAEDGE 2G TDMA

HSPA, HSPA+ 3G W-CDMA1xRTT 2G CDMA

1x Advanced 2G CDMAEVDO 3G CDMA

WiMAX 4G OFDMALTE 4G OFDMA

LTE Advanced 4G OFDMA


Technology Evolution• Current ITU standards• Forward compatibility not possible• GPRS radios cannot operate in EDGE or HSPA modes

• Backward compatibility is per standard• HSPA radios can operate in GPRS and EDGE mode

• UMTS / HSPA standards kept modular by the ITU• To allow for easy removal of GPRS and EDGE … eventually

• Radio technology transitions are required• HSPA transports use W-CDMA protocol (not TDMA like GPRS/EDGE)• Cannot co-exist in the same spectrum

• LTE uses OFDMA protocols• Cannot co-exist in the same spectrum as W-CDMA (or CDMA or TDMA)


Verizon• 1XRTT and EVDO everywhere• Will maintain through 2018-2020 – possibly longer

• Deploying LTE ahead of AT&T and Sprint• MetroPCS was first to go commercial though• Accounts for 70% of LTE deployments world-wide

• LTE is deployed in 700MHz band• Using 20MHz in Upper C block• Will be adding 1.7/2.1GHz coverage now that FCC has approved

• Good spectrum position … after FCC approval• 700MHz, 850MHz and 1.9GHz• Acquiring 1.7/2.1GHz in Western US markets from cable operators


AT&T• GPRS/EDGE everywhere, HSPA in many markets• Plans: GPRS and EDGE completely removed by end of 2016

• Deploying LTE in major markets• Roll-out is behind Verizon, but ahead of Sprint today• Has greatly slowed their HSPA roll-out … 70% - 80% is LTE

• T-Mobile acquisition effort• Failure of acquire hurt in multiple ways: capital and spectrum• Forced AT&T to start the “re-farming” of 2G

• Spectrum position is weak for needs• 700MHz, 850Mhz, 1.9GHz and 1.7/2.1GHz in many markets• Needs to re-use spectrum with more efficient technology


Sprint• 1XRTT and EVDO everywhere (at 1.9GHz)• Extensive roaming for coverage comparable to Verizon and AT&T

• First to deploy All-Digital and first to deploy 4G• Was not affected by AMPS Sunset• WiMAX deployment in 2009 (via Clearwire)

• Deploying LTE in 1.9GHz Block G• Has also received approval for LTE at 800MHz and 2.5GHz• Innovative Network Vision project uses spectrum wisely

• Best spectrum ownership, but not deployment• Will convert iDEN (Nextel) spectrum to LTE and 1X• 800MHz, 1.9GHz and 2.5GHz


T-Mobile• GPRS / EDGE in major markets, HSPA in many of these• Will keep GPRS / EDGE operational longer than AT&T, but still inevitable

• Deploying HSPA and HSPA+ in their markets• Data speeds are fast, but not 4G • Also deploying HSPA+42 in some markets

• Has announced LTE is in their future• Well behind the other Tier-1 Carriers• Losing market share and number of subscribers

• Spectrum ownership is major markets only• Even after receiving spectrum in many markets from AT&T• Potential acquirer of 700MHz bands being sold by Verizon


• Tier 1• VzW, AT&T and Sprint are adding units steadily• T-Mobile is losing units to others – mostly other Tier 1

• Tier-2• Mostly losing units overall• MetroPCS is a counter-example

• Tier-3• Little overall change – slow growth/reduction• Significant competitive pressure from Tier 1 and 2

• Number of cellular units• More than 7% greater than US Population• More than 15% when under 5 year olds are not counted

• Notes– Verizon subscribers include Strategy Analytics’ estimates for wholesale and

connected device volumes– Sprint Nextel subscribers excluding estimated number of affiliate subscribers, but

including wholesale– Clearwire subscribers include wholesale subs outside current 4G network

coverage area from whom they receive nominal revenue – Cellular South is a private company and does not reveal its metrics, estimated 0.9-

1.0 million subscribers

Deployed Units (2012 Q2)Carrier Units

(millions)UnitAdds

1 Verizon 111.0 ++++2 AT&T 105.0 ++++3 Sprint 56.1 +++4 T-Mobile 33.2 -5 Clearwire 10.9 --6 MetroPCS 9.3 ++7 Leap Wireless 5.9 -8 US Cellular 5.8 -9 Cellular South 0.9 – 1.0

10 ATN 0.6 +11 Cincinnati Bell 0.4 -12 Ntelos 0.4 +

Source: Strategy Analytics, based on Carrier reports


2G GSM/GPRS Shutdown• Predictable more than 5 years ago• Spectrum efficiency of TDMA far worse than CDMA• AT&T under strong competitive pressure from Verizon and Sprint

• Data performance unacceptable with increasing use of Smartphones

• Pressure on AT&T increased 1.5 to 2 years ago• Spectrum costs and availability continued to increase• W-CDMA deployments not sufficiently competitive to EVDO

• In 2011, AT&T attempt to acquire T-Mobile failed• Accelerated the [inevitable] demise of 2G• Senior AT&T Exec made public comments about outcome

• Early 2012, letters sent to Customers in NY• Asking them to swap out all their 2G devices, and then “re-farming” started

• Recent announcement by AT&T• GPRS Sunset date set “Jan 1, 2017” … i.e., end of 2016


Overall Impact• Major markets will shut down sooner• Probably as soon as end-2014 to mid-2015• Re-farming of spectrum has already started in NYC

• AT&T stopped certifying new 2G applications• No new 2G customers/applications can be approved or deployed

• AT&T will soon disallow new 2G unit shipments• All Customers must plan to stop selling existing 2G product

• Estimated 12 – 15 M units need to be replaced• In four years … or less!

• Radio Module and unit suppliers revenues increase• May stress manufacturing capacity temporarily


Impact to Alarm Industry• Alarm industry estimated at 4 – 5 M units• Impact greater than AMPS Sunset (was <1 M units)

• Urban markets will degrade sooner than rural• Right where the alarm units are deployed

• Putting aside new sales for a moment …• Industry must replace existing units at 4,500 – 5,000 units/day• … starting tomorrow, for the next 4 years• Could be double that rate in major markets (2 years is likely)

• Moving to T-Mobile could extend the date• Most likely needs SIM swap in unit (unless AT&T assists)

• Industry needs a comprehensive plan• New designs, schedule from AT&T, logistics, training, etc.


Options

• These do not help the existing 2G unit deployments

2G GPRS Unit

Replace with T-Mobile Service

Replace with 3G HSPA Unit

Replace with 2G CDMA Unit

Replace with 4G LTE Unit

Do not replace the 2G Unit


Replace with T-Mobile Service• Needs SIM swap in all likelihood• Most SIM’s are not programmable from one Carrier to another

• Delays the sunset date• But does not eliminate it … T-Mobile will also eventually remove 2G

• T-Mobile coverage not as good as AT&T• But many major cities are covered … where units are located!

• Buys time to implement a longer-term strategy• Stretch 2 – 4 year problem to 4 – 6 year problem


Replace with 3G HSPA Unit• Needs a new product• Alarm industry suppliers are on this path already

• Radio Module cost is higher than 2G• Unit cost is likely to be higher

• 3G HSPA coverage is less than 2G• Most major markets are covered, but … need to check!• In non-3G markets, 2G likely to be replaced by 4G

• 3G HSPA will also get swapped for 4G LTE in time• Date is uncertain, but likely to be around 2018 to 2020

• Avoids current 4G issues (coverage, price, etc.)• But “third Sunset” will be worse (# of units)


Replace with 2G 1xRTT Unit• Needs a new product• Alarm industry suppliers not on this path

• Radio Module cost is higher than 2G GSM• But less than 3G HSPA or 3G EVDO

• 1xRTT coverage as good, or better, than GPRS• Combined footprint of CDMA Carriers

• Longevity of 1xRTT service is better• Better than 2G GPRS (2014-2016), 3G HSPA (2018-2020)


Replace with 4G LTE Unit• Needs a new product• Alarm industry suppliers must start new designs

• Radio Module considerably higher today• Will drop in time of course

• Coverage is very limited today• Will improve in time of course

• Other near-term issues• Will describe shortly


Do Not Replace 2G Units• During AMPS Sunset, many companies failed• Financial impact of replacing units was simply too high

• Could also happen with GPRS Sunset• Current GPRS application providers could fail• Consumers and their units be impacted

• This is not good for the M2M industry• Dramatic growth could slow down for some years


Recent Aeris Experience• Large number of GPRS 1xRTT service migrations• Aeris is gaining many new Customers … new designs, of course!

• Some customers moving to HSPA• With AT&T, T-Mobile, Aeris and others – a few concerned about next Sunset

• A few Customers moving to EVDO• Enhanced data rate is interesting for new application and features

• Longevity of 1xRTT service is appealing• Particularly for automotive industry

• 1xRTT Module cost lower than 3G (HSPA and EVDO)• Reduced cost burden

• Customers can maintain dual-technology service• Aeris providing single interface for multi-technologies


Verizon LTE (“304 cities, 200M POPs”)


Verizon LTE• Has 700 MHz band 13 (“in the entire US”)• This is all of the 700MHz Upper C• For 10 MHz up and 10 MHz down (total of 20 MHz)

• Has 700 MHz band 17 (“in many Eastern US markets”)• But has offered up their Lower A, B and E spectrum to get AWS 1700/2100

from SpectrumCO (particularly in Western US)


Verizon 3G/4G Coverage


AT&T LTE (“47 markets, 74M POPs”)


AT&T LTE• Has 700 MHz band 17 (in some of the country)• This is in the 700 MHz Lower A, B and C blocks

• Plans 1700/2100 MHz band 4 (in much of the country)• But currently running UMTS and HSPA in that spectrum• Needs more spectrum to deploy LTE in some markets


Sprint 3G / WiMAX Coverage


Sprint LTE• LTE deployment started• 4G LTE and enhanced 3G service launched in Atlanta, Dallas, Houston,

Kansas City and San Antonio• Includes surrounding markets

• Expansion by end of 2013• … To the picture shown on next page• No definitive schedule announced yet


Sprint LTE (“250M POPs end of 2013”)


MetroPCS LTE (“16 cities, XXX POPs”)


US Cellular LTE (“6 Markets”)


US Cellular LTE• Expansion planned in 2012• “Additional cities in Illinois, Maryland, Missouri, New Hampshire, Oregon,

Tennessee, Vermont, Virginia, Washington, and West Virginia will also have access to 4G LTE by the second half of 2012.”


Near-term LTE Issues• Limited radio Module availability and support• Only single-band LTE (hence, single-Carrier) models available today• Module fallback to 3G and 2G are different

• Radio Module costs are high today• Will drop in time

• LTE roaming agreements not in place yet• Technical and business barriers• Coverage is limited to major cities

• 36 frequency bands approved by ITU• ~6 bands required for North America, ~4 bands for EU, ~4 bands for Asia• >12 needed for Single-SKU worldwide deployment


US Spectrum OverviewFreq. VzW AT&T Sprint T-Mobile US Cellular Clearwire MetroPCS Satellite

Today Future Today Future Today Future Today Future Today Future Today Future Today Future Future

700 MHzUpper C LTE LTE — — — — — — — — — — — — —

700 MHzLower A,B,C

OwnsA,B

Up forsale LTE LTE — — — — Owns

A,B,C LTE — — OwnsA LTE —

700 MLower D,E

OwnsE

Up forsale

OwnsD,E ??? — — — — — — — — — — —

800 MHziDEN — — — — iDEN

clearedLTE-Adv1X-Adv — — — — — — — — —

850 MHzCellular CDMA LTE

CDMA GSM LTEHSPA — — Owns 3

counties — CDMA LTECDMA — — — — —

1.6 GHzMSS — — — — — — — — — — — — — — Light2

LTE-Adv

1.7/2.1 GHzAWS

OwnsA,B,C,F

WantsLTE HSPA LTE

HSPA — — HSPA LTE-AdvHSPA LTE LTE — — LTE

CDMA LTE —

1.9 GHzPCS CDMA LTE

CDMAUMTSHSPA

LTEHSPA CDMA LTE-Adv

CDMAGSMHSPA

LTE-AdvHSPA

LTECDMA

LTECDMA — — CDMA ??? —

1.9 GHzBlock G — — — — LTE LTE

LTE-Adv — — — — — — — — —

2.0 GHzMSS — — — — — — — — — — — — — — Dish

LTE-Adv

2.3 GHzWCS — — — ??? — — — — — — — — — — —

2.5 GHzBRS/EBS — — Owns

in PR ??? WiMAX TDDLTE — — — — WiMAX TDD

LTE — — —


Spectrum Band (MHz)

North America

Latin America

Asia Pacific

Western Europe

Eastern Europe

Africa Middle East

700 + 1800

1900 (block G)

700 + 1700/2100

700 + 2600

800 + 1800

850 + 1900

800 + 1900

800 + 2600

800 + 1800 + 2600

900 + 1800

1800 + 2600

1700/2100 + 2600

2300 + 2600

1600

2000

2500

LTE Bands and Combinations


Protocols in Use and Futures

Technology Gen ProtocolVzW, US Cellular,

etc.Sprint, Aeris AT&T, T-

Mobile, etc. Other

GPRS 2G TDMA ●

EDGE 2G TDMA ●

HSPA, HSPA+ 3G W-CDMA ●

1xRTT 2G CDMA ● ●

1x Advanced 2+ G CDMA ●

EVDO 3G CDMA ● ●

LTE 4G OFDMA ● ● ● ● Clearwire

LTE Advanced 4G OFDMA TBD ● future TBD ● Dish


Technology in Radio Modules

Technology Protocol GPRSModule

EDGEModule

1xRTTModule

EVDOModule

HSPAModule

LTE / CDMA

ModuleLTE

Module

GPRS TDMA ● ● ● ●

EDGE TDMA ● ● ●

HSPA, HSPA+ W-CDMA ● ●

1xRTT CDMA ● ● ●

EVDO Rev. 0 CDMA ● ●

EVDO Rev. A CDMA ● ●

LTE OFDMA ● ●


Radio Module Pricing Today• Low volume

Technology(And Combinations) Cost VzW ATT Sprint T-Mobile US

Cellular Clearwire MetroPCS Satellite

GPRS < $15 ● ●EDGE/GPRS Not Avail.1xRTT < $25 ● ● ● ●EVDO + 1xRTT < $30 ● ● ● ●HSPA + EDGE/GPRS < $35 ● ●LTE + EVDO + 1xRTT > $100 ● ● ● ●LTE + HSPA + EDGE/GPRS > $100 ● ●LTE only (not standard) TBD ● ● ● ●TDD-LTE TBD ● ● ●LTE-Advanced TBD ● ● ●


Contact• Syed Zaeem Hosain (“Z”)• Chief Technical Officer• Direct: 408-557-1905

Fax: 408-557-1925E-mail: [email protected]: @AerisCTO

• Address• Aeris Communications, Inc.

2350 Mission College Blvd., Suite 600Santa Clara, CA 95054-1574.

• Corporate Web site• www.aeris.net

• Technology Blog• Aeriscto.wordpress.com

mailto:[email protected]

http://www.aeris.net/

http://aeriscto.wordpress.com/

http://aeriscto.wordpress.com/


Thank you!


Backup Slides


Core US Spectrum BandsSpectrum Description Low High Low High Width Comment

700 MHz

Lower Band A 698 704 728 734 6 + 6

Lower Band B 704 710 734 740 6 + 6 Also broadcast television at 704 – 710

Lower Band C 710 716 740 746 6 + 6

Lower Band D 716 722 ---- ---- 6

Lower Band E 722 728 ---- ---- 6 Also broadcast television at 722 – 728

Upper Band C 746 757 776 787 11 + 11

Upper Guard B and A 757 758 787 788 1 + 1

1.7 GHz / 2.1 GHz AWS-1

Channel A 1710 1720 2110 2120 10 + 10

Channel B 1720 1730 2120 2130 10 + 10

Channel C 1730 1735 2130 2135 5 + 5

Channel D 1735 1740 2135 2140 5 + 5

Channel E 1740 1745 2140 2145 5 + 5

Channel F 1745 1755 2145 2155 10 + 10

1.9 GHz PCS

Channel A 1850 1865 1930 1945 15 + 15

Channel D 1865 1870 1945 1950 5 + 5

Channel B 1870 1885 1950 1965 15 + 15

Channel E 1885 1890 1965 1970 5 + 5

Channel F 1890 1895 1970 1975 5 + 5

Channel C 1895 1910 1975 1990 15 + 15

Channel G 1910 1915 1990 1995 5 + 5

850 CellularChannel A 824, 845 835, 846.5 869, 890 880, 891.5 25

Channel B 835, 846.5 845, 849 880, 891.5 890, 894 25

2012-09-06 AICC Meeting Syed Zaeem Hosain Aeris Communications, Inc.

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Transcript of 2012-09-06 AICC Meeting Syed Zaeem Hosain Aeris Communications, Inc.